HARARE, Dec. 13 (Xinhua) -- Power shortages are having a huge negative impact on Zimbabwe, costing the country an estimated 6.1 percent of gross domestic product (GDP) per year, the World Bank said in its fourth Zimbabwe Economic Update report launched in Harare, Zimbabwe's capital, Wednesday.
The 6.1 percent comprises 2.3 percent of GDP in generation inefficiencies and excessive network losses, and 3.8 percent of GDP on the downstream costs of unreliable energy, the World Bank said in its report titled "Electrifying Growth through Reliable and Universal Energy Access."
The World Bank noted that despite some recent achievements, Zimbabwe's energy sector still faces major challenges, including significant power deficits.
While the Zimbabwean government commissioned an additional 600 MW at the Hwange Thermal Power station this year, installed capacity is currently still insufficient to meet demand, and rolling blackouts significantly burden Zimbabwe's economic growth and competitiveness.
The pace of rural electrification has also slowed down and there is a need for significant investment to achieve universal access by 2030, the World Bank said.
Zimbabwe has set itself the target to significantly improve electricity reliability and expand households' access to electricity by 2030, but this target would be hampered by inadequate investments in the sector, the World Bank warned.
"If Zimbabwe hopes to achieve the high growth rates needed to move toward upper middle-income status by 2030, it will be critical to realize stable and reliable electricity access," the World Bank said.
Zimbabwe's peak electricity demand is projected to grow substantially, with medium-term World Bank projections suggesting that electricity demand will grow from 1,950 MW in 2022 to 5,177 MW by 2030.
Thus achieving universal access to electricity by 2030 will require large investments, especially in solar power and grid expansion, the World Bank said.
To achieve universal access by 2030, it will require annual connections to increase from 25,000 in 2020 to about 537,000 per year, with utility-scale home solar systems expected to be the fastest units to provide additional capacity.
According to the World Bank, the associated grid network expansion to 2030 is estimated to cost 4.4 billion U.S. dollars.
Speaking at the same event, Finance, Economic Development and Investment Promotion Minister Mthuli Ncube said Zimbabwe requires an investment of 2 billion dollars to upgrade its electricity transmission infrastructure, and invited partners to help it upgrade the infrastructure. ■